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It's a very small matter, yet an incredibly powerful one and it has come to my attention that even a few seasoned bank tellers don't fully understand the legal difference between the words and / or. It's as simple as this: when you open a joint financial account, you make the joint designation with one of those two words. The account can be in the names of John and Jane Doe, or alternatively it can read John or Jane Doe.

The word and designates co-authority over an account, whereas the word or designates that either party has independent authority over the account. This means that the and account requires the signature of both account holders when conducting business, while the or account can be utilized by either individual without the signature of the other account holder.

The time when this small detail can be extremely important is in the unfortunate case when one of the joint account holders meets their demise. In the case of the or account, business on that account may be conducted by the surviving partner without any trouble. However, in the case of the and account, because one of the account holders can no longer participate in authority over the account, the surviving partner is unable to conduct business on that account. Often times a surviving partner in this situation must wait for the former partner's estate to clear probate before they can regain useful access to the account or hasty power of attorney arrangements must be made. Proper use of the words can also be of paramount importance in regard to marital property laws or the lack thereof.

Be sure that you have joint accounts designated the way you need them to be, and bear in mind that this same principle generally applies to joint ownership of items which require a title document. They are very small words, but used incorrectly, they can quite possibly cause you loss and / or heartache.